IRVINE, Calif., Nov. 10 /PRNewswire-FirstCall/ -- Cardiogenesis
Corporation (Pink Sheets: CGCP), a leading developer of surgical
products used in the treatment of patients suffering from severe
angina, today reported financial results for its third quarter
ended September 30, 2009. Net revenues in the third quarter of 2009
totaled $2,134,000 an 18% decrease from prior year third quarter
net revenues of $2,618,000. The decrease in sales was primarily
attributed to the absence of laser sales during the three month
period ended September 30, 2009 as compared to laser sales of
$373,000 for the three months ended September 30, 2008. Net
revenues in the first nine months of 2009 totaled $7,222,000, a 26%
decrease from net revenues of $9,719,000 in the first nine months
of 2008. Laser sales decreased $1,832,000 and handpiece sales
decreased $786,000 as compared to the prior year nine month period.
"We continue to make progress in our efforts to re-engage the
cardiology community and to refocus our sales force on utilization
of previously installed lasers. We are taking the right steps to
increase our core TMR business," said Paul McCormick, Executive
Chairman. He continued, "At the same time we are stepping up our
investment in research and development as we prepare to initiate a
U.S. clinical trial for our PHOENIX(TM) Combination Delivery
System, which permits the intramyocardial delivery of both TMR and
stem cells. Based upon our recent meeting with the FDA we expect to
make our IDE submission by the end of the year." The Company
reported a third quarter 2009 operating loss of $718,000 as
compared with an operating loss of $310,000 in the prior year
quarter. The net loss for the quarter was $739,000 or $0.02 per
basic and diluted share, as compared with net loss of $308,000, or
$0.01 per basic and diluted share in the 2008 third quarter. For
the first nine months of 2009, Cardiogenesis reported an operating
loss of $1,577,000 as compared with operating income of $235,000
for the same period in 2008. The net loss for the first nine months
of 2009 was $1,643,000 or $0.04 per basic and diluted share,
compared with net income of $258,000, or $0.01 per basic and
diluted share, for the first nine months of 2008. Gross margin was
82% of net revenues for the quarters ended September 30, 2009 and
2008. Gross profit decreased by $390,000 to $1,754,000 for the
current year third quarter as compared with $2,144,000 for the 2008
third quarter. For the nine months ended September 30, 2009, gross
margin was 82% of net revenues as compared to 84% for the nine
months ended September 30, 2008. Gross profit in absolute dollars
decreased by $2,215,000 to $5,915,000 for the nine months ended
September 30, 2009, as compared to $8,130,000 for the nine months
ended September 30, 2008. The decrease in the gross margin
percentage for the three months and nine month periods was
primarily attributed to a decrease in laser sales. Research and
development expenses were $379,000 in the third quarter of 2009 as
compared with $165,000 in the 2008 third quarter. Year to date,
R&D expenses of $1,013,000 were $380,000 or 60% above the prior
year period of $633,000. The dollar increase for the three month
and nine month periods are primarily attributed to regulatory
expenses incurred for FDA submissions. Sales and marketing expenses
of $1,363,000 in the quarter ended September 30, 2009 decreased
$173,000, or 11%, compared with $1,536,000 for the quarter ended
September 30, 2008. For the nine months ended September 30, 2009,
sales and marketing expenditures totaled $4,104,000, a decrease of
$754,000, or 16%, compared with $4,858,000 for the nine months
ended September 30, 2008. The decrease in sales and marketing
expenditures for both the third quarter and nine month periods
ended September 30, 2009 as compared to the corresponding prior
year periods, was primarily due to lower commissions and related
employee expenses. In addition, travel expenses for the nine months
ended September 30, 2009 were $151,000 lower than the first nine
months of 2008. General and administrative expenses for the quarter
ended September 30, 2009 totaled $730,000 as compared to $753,000
during the quarter ended September 30, 2008. For the nine months
ended September 30, 2009, general and administrative expenses
totaled $2,375,000 as compared to $2,404,000 for the nine months
ended September 30, 2008. About Cardiogenesis Corporation
Cardiogenesis is a medical device company specializing in the
treatment of cardiovascular disease and is a leader in devices that
treat severe angina. Our market leading holmium:YAG laser system
and single use fiber-optic delivery systems are used to perform a
FDA-cleared surgical procedure known as Transmyocardial
Revascularization (TMR). For more information on Cardiogenesis and
its products, please visit our website at
http://www.cardiogenesis.com/ or the direct to patient website at
http://www.heartofnewlife.com/. Safe Harbor Statement This press
release contains forward-looking statements, including, without
limitation, with respect to the Company's expectation to file an
IDE for the Company's PHOENIX(TM) Combination Delivery System. Any
forward-looking statements in this news release are subject to
numerous risks and uncertainties, many of which are outside the
Company's control, that could cause actual results to differ
materially. Factors that could affect the accuracy of these
forward-looking statements include, but are not limited to: any
inability by the Company to sustain profitable operations or obtain
additional financing on favorable terms if and when needed; any
failure to obtain required regulatory approvals; failure of the
medical community to expand its acceptance of TMR procedures;
possible adverse governmental rulings or regulations, including any
FDA regulations or rulings; the Company's ability to comply with
international and domestic regulatory requirements; possible
adverse Medicare or other third-party reimbursement policies or
adverse changes in those policies; any inability by the Company to
ship product on a timely basis; the Company's ability to manage its
growth; the effects of recent disruptions in global credit and
equity markets and other adverse economic developments that could
adversely affect the market for our products or our ability to
raise needed financing; actions by our competitors; and the
Company's ability to protect its intellectual property. Other
factors that could cause Cardiogenesis' actual results to differ
materially are discussed in the "Risk Factors" section of the
Company's Annual Report on Form 10-K for the year ended December
31, 2008 and the Company's other filings with the Securities and
Exchange Commission. The Company disclaims any obligation to update
any forward-looking statements as a result of developments
occurring after the date of this press release. CARDIOGENESIS
CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in
thousands, except per share amounts) (unaudited) Three months ended
Nine months ended September 30, September 30, 2009 2008 2009 2008
---- ---- ---- ---- Net revenues $2,134 $2,618 $7,222 $9,719 Cost
of revenues 380 474 1,307 1,589 --- --- ----- ----- Gross profit
1,754 2,144 5,915 8,130 ----- ----- ----- ----- Operating expenses:
Research and development 379 165 1,013 633 Sales and marketing
1,363 1,536 4,104 4,858 General and administrative 730 753 2,375
2,404 --- --- ----- ----- Total operating expenses 2,472 2,454
7,492 7,895 ----- ----- ----- ----- Operating income (loss) (718)
(310) (1,577) 235 Other income (expense): Interest expense (4) (1)
(35) (22) Interest income 1 13 3 55 Other non-operating expense
(20) - (20) - ---- --- ---- --- Total other income (expense), net
(23) 12 (52) 33 ---- --- ---- --- Income (loss) before income taxes
(741) (298) (1,629) 268 Provision for income taxes (2) 10 14 10 ---
--- --- --- Net income (loss) (739) (308) (1,643) 258 ===== =====
======= === Net earnings (loss) per share: Basic $(0.02) $(0.01)
$(0.04) $0.01 ====== ====== ====== ===== Diluted $(0.02) $(0.01)
$(0.04) $0.01 ====== ====== ====== ===== Weighted average shares
outstanding: Basic 45,549 45,292 45,519 45,292 ------ ------ ------
------ Diluted 45,549 45,292 45,519 45,328 ------ ------ ------
------ CARDIOGENESIS CORPORATION CONDENSED CONSOLIDATED BALANCE
SHEETS (in thousands) September December 30, 31, 2009 2008
(unaudited) (audited) ---------- -------- ASSETS Current assets:
Cash and cash equivalents $2,517 $2,907 Accounts receivable, net of
allowance for doubtful accounts of $7 and $20, respectively 941
1,330 Inventories 984 1,164 Investments in marketable securities -
75 Prepaids and other current assets 356 395 --- --- Total current
assets 4,798 5,871 Property and equipment, net 350 382 Other
assets, net 18 18 --- --- Total assets $5,166 $6,271 ====== ======
LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts
payable $338 $200 Accrued liabilities 1,020 1,103 Deferred revenue
971 800 Note payable 140 - Current portion of capital lease
obligations 9 6 --- --- Total current liabilities 2,478 2,109
Capital lease obligations, less current portion 16 13 --- --- Total
liabilities 2,494 2,122 ----- ----- Commitments and Contingencies
Shareholders' equity: Preferred stock: no par value; 5,000 shares
authorized; none issued and outstanding - - Common stock: no par
value; 75,000 shares authorized; 45,549 and 45,487 shares issued
and outstanding, respectively 174,165 173,999 Accumulated deficit
(171,493) (169,850) --------- --------- Total shareholders' equity
2,672 4,149 ----- ----- Total liabilities and shareholders' equity
$5,166 $6,271 ====== ====== DATASOURCE: Cardiogenesis Corporation
CONTACT: William R. Abbott, Senior Vice President and Chief
Financial Officer of Cardiogenesis Corporation, +1-949-420-1800 Web
Site: http://www.cardiogenesis.com/
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